A proposal that would dramatically change the structure of economic benefits available to ultra-Orthodox men is currently being discussed by the Knesset's Plesner Committee, tasked with finding an alternative to Israel's Tal Law.

The 2002 Tal Law fixed the conditions under which ultra-Orthodox yeshiva students could receive a draft exemption, and continue their religious studies instead of serving in the Israel Defense Forces. The law also created a special framework for Haredi men to complete their national service obligation in a manner that accommodated the special needs presented by their religious lifestyle.

But Israel's High Court declared the Tal Law unconstitutional this past February, necessitating a search for the law's replacement.

Some of the ideas currently being discussed by the committee were first raised by Eyal Gabbai, former director general of the Prime Minister's Office. Other ideas were brought forth by the Finance Ministry. The proposal promotes the creation of a new system of economic incentives that would be linked to the completion of army service, or civilian national service.

The system would be structured so that the incentives would be inversely proportional in value to the beneficiary's age. At some point, if he does not fulfill his obligation, the incentives would take on negative value. In other words, the longer a Haredi man defers his national service obligation, the fewer benefits he will receive for doing so. Once he reaches a certain age without serving, the financial incentives would turn into financial penalties.

The proposed penalties would include the revocation of government benefits Haredim typically receive, such as reduced municipal property taxes (arnona ), subsidized preschool tuition, reduced health care taxes, reduced rents for public housing, and income supplements paid by yeshivas directly to their Haredi students.

The Plesner Committee hearings are still in their early stages, which makes discussing the finer details of the proposal difficult, if not impossible. Nevertheless, it seems the proposal is being seriously considered by committee members. It might be the case, in fact, that ultimately, only vigorous political opposition - like perhaps the opposition of a frightened prime minister trying to preserve his broad government coalition - would be enough to dissuade the committee from adopting the proposal.

Perverse incentive discourages service

The proposal also includes a change in the funding for kollels, yeshivas where married men study full-time. Today, these institutions receive state funding based on the number of students enrolled. This financial instrument serves as a perverse incentive for kollels to discourage their students from leaving to serve in the army or to join the working world; thus the way financial incentives for kollels are structured is not currently in the state's interest.

Under the proposal being discussed by the Plesner Committee, the new rules would base state funding for a yeshiva on the number of its students who serve in the army or civilian national service, instead of the total number of individuals studying at any given yeshiva.

A certain percentage of every age cohort would be labeled as talmidei chachamim (literally, wise students ). Yeshivas would be entitled to receive state aid for these select students over the course of their entire lives. The stipend for each talmid chacham might even be larger than the current stipend currently provided for each kollel student.

Still, the reform would mean yeshivas would have the overall financial incentive to encourage their students to participate in national service. The proposal would set national service quotas for every age group of Haredi men. Yeshivas that fail to meet their quota would pay the price in reduced state aid for its annual budget. Any yeshiva that lost this money would find it more difficult to fund the studies of those Haredi men who do choose full-time studies over national service obligations.

Furthermore, the committee is considering granting an increase in funding to yeshivas whose students serve, and then return to the kollel.

Better conditions for all

The Plesner Committee has also been examining the possibility of enticing more Haredi men into military service by improving conditions for all soldiers - regardless of their religious status - since the principle of equality would not allow Haredi soldiers to receive better treatment than others. Improved conditions could include reducing mandatory service time periods, and offering competitive salaries to those who serve longer, as proposed by the Ben-Bassat Committee in 2005.

The incentives would be greater for someone who does military service than for someone who does civilian national service, and someone who agrees to serve at age 18 will receive a greater incentive than someone who serves at age 20.

In order to enable the smooth integration of Haredi men into national service, the committee is also debating a substantial expansion in the number of IDF service tracks available specifically to the ultra-Orthodox.

Some of the possibilities under discussion include the establishment of Haredi hesder yeshivas, which would combine periods of military service with Judaic studies; opening the air force technician training course to Haredi men between the ages of 18-20 (today the course is only open to those age 22 and over ); and the creation of new service options in the police, prison service and firefightin services.

If the proposed measures are implemented, the number of Haredi yeshiva students is expected to drop, which would mean Haredi yeshivas will receive less funding. Such a move is expected to be met by staunch opposition from the ultra-Orthodox parties in the Knesset. Consequently, the Plesner Committee is reviewing different ideas to keep the funds in the Haredi sector, by earmarking the money that would have gone to yeshivas for other ultra-Orthodox causes.

Penalties for non-service?

Some ideas being considered include increased government funding for professional training programs targeted toward the Haredi community or for support programs catering to young Haredi social dropouts.

The most sensitive topic that is being discussed in the committee is the possibility of enacting financial penalties for those Haredi men who refuse to commit to national service of any type. Aside from a cancellation of their kollel stipends, failure to serve could result in the loss of all the other subsidies and benefits Haredim currently receive directly from the state.

Among the benefits that may be cancelled are subsidized preschool and daycare tuition. The government's current means-testing for subsidized preschool tuition counts Haredi men who learn all day as being employed, qualifying their households to receive the tuition discount. Additionally, many Haredi families receive reductions on municipal property taxes, the government health care tax, subsidized public rental housing and subsidized mortgages for first-time apartment buyers. All those benefits are in danger of being lost if Haredi men refuse to serve the country, under the Tal Law alternative being discussed.

Nevertheless, a significant portion of income for many Haredi families comes from child benefit payments. These benefits are given to all Israeli families regardless of religious affiliation, and therefore their cancellation is not under consideration.

Because only benefits specific to the Haredi sector can be used as a "stick," to persuade the ultra-Orthodox to fulfill their national duties, the Plesner Committee has asked the Finance Ministry to gather information on all the different types of benefits and discounts that Haredi families receive.

Based on a National Economic Council projection made three years ago by researcher Hagay Levine, Haredi families receive, on average, between NIS 4,000 - NIS 5,000 per month through various state benefits, subsidies and private donations made to families through their yeshivas. Some NIS 800 of that comes from their kollel stipends; another NIS 1,000 comes from the state's welfare income supplement and about NIS 230 comes from municipal property tax reductions.

The National Economic Council estimates that Haredi families spend an average of between NIS 600 - NIS 800 per month on preschool for two children. By way of comparison, full preschool tuition costs about NIS 4,000 per month for two children.

Survival of families st stake

In all, the various discounts, benefits and subsidies that Haredim receive come to several thousands of shekels per month. The cancellation of these benefits will likely affect Haredi families to a great extent, perhaps even their ability to survive. Essentially, this means that a Haredi man who refuses to participate in national service and refuses to work will find it very difficult to support his family financially.

The assumption, therefore, is that if the proposals under consideration are eventually approved, economic necessity will prevent the widespread refusal to serve for which the Haredi community is now known.

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